African Queen Mines (CVE:AQ) said Monday that, together with its joint venture (JV) partner, Abba Mining, it has reached a settlement agreement related to its land dispute with Linear Metals Corp (TSE:LRM), and Linear's JV partner, B&M Mining, earlier this year.
In February, African Queen and Abba filed for a prohibition order, claiming that the 15-square kilometre area covered by Linear and B&M's Special License No. 214, is also covered by its own Special License No. 287, which African Queen and Abba had received in January.
The area in question covers the Kamwango prospect in the Rongo area of the Migori mining district in Kenya.
Under the terms of the new agreement, B&M will remain the beneficial owner of the license No. 214, covering the area of 15 square kilometers in the Rongo area, subject to a one percent net smelter royalty (NYSE:NSR) payable to African Queen, and a one percent NSR payable to Abba.
Abba will, meanwhile, remain the beneficial owner of the license No. 287, which roughly covers 97-square kilometres surrounding the No. 214 area.
All parties involved have also agreed to withdraw all civil actions related to the licenses.
Additionally, Linear will acquire the technical information related to the license No. 214 area from African Queen, for $500,000 in total. Upon receipt of the information, African Queen will receive $150,000 in cash. Subject to regulatory approvals, it will receive $200,000 in Linear common shares, with the remaining $150,000 cash payable 12 months following the date of the first payment.
The agreement allows Linear and African Queen to move forward with their respective exploration programs in Kenya, with Linear retaining rights to the Kamwango prospect while African Queen retains rights to the Odundu prospect.